50 Years
of Financing Affordable Homes for New Yorkers
2021 Annual Report
Richard M. Froehlich
(1963 – 2021)
First Executive Vice President
& Chief Operating Officer, HDC
In Memory of Richard M. Froehlich
“I believe we live in two Cities. The visible city, and the invisible city. The visible city is the brick and mortar, the glass and steel, the concrete and macadam. The invisible city is the relationships and the intricate financial webs, the true mortar that holds things together. Rich left his indelible imprint throughout our visible and invisible city. Through an elegant calculus, he helped build our neighborhoods; and through a crazy, complex, confounding, loving way he built a crazy, complex, confounding, loving set of relationships, which we have all benefited immensely from. Rich was a quilter, a weaver, a knitter of all these complex filaments and we all, and this city, incalculably benefited from his efforts.
We will all miss Rich dearly.”
Marc Jahr
Former HDC President
The 1970s
Early Years
HDC Created by NYS Legislature
The New York City Housing Development Corporation (HDC) was formed as a vehicle to improve New York City’s supply of housing for low- and moderate-income households. Created by a state act effective June 17, 1971, HDC was authorized to sell bonds in an amount up to $800 million. The following May of 1972, HDC became fully operational following the passage of New York City Council Local Law No. 34.
HDC Issues First Bond Sale
HDC’s early investments were dedicated to supporting the City’s Mitchell-Lama program, which to this day provides affordable rental and cooperative housing to moderate and middle income families. In 1972, HDC’s first bond sale in principal amount of $133 million led to the closing of three mortgages financing 3,028 units of Mitchell-Lama housing at Washington Plaza Towers, Waterside Plaza, and Ocean Park Apartments.
NYC on Brink of Bankruptcy
At the height of a dire fiscal and political crisis, the City of New York was effectively shut out from the credit markets and unable to borrow funds needed to avoid bankruptcy. Nonetheless, HDC’s positioning remained sound and the Corporation was able to continue to support the city’s affordable housing needs despite difficult market conditions.
HDC Finances First Preservation Effort
HDC financed its first preservation effort at Kew Gardens Hills, which involved the rehabilitation of three severely deteriorating Mitchell-Lama developments comprising 1,269 affordable homes in Queens. Renovations were completed with all residents remaining in place and the financing also resulted in the beautification of the surrounding neighborhood.
Ed Koch becomes NYC Mayor
NYC HPD Is Formed
During the summer of 1977, the City of New York restructured HDC’s partner city housing agency, The NYC Housing Development Administration (HDA), to become the NYC Department of Housing Preservation & Development (HPD).
The 1980s
Time of Crisis and Opportunity
HDC Markets Bonds to Aid NYC
Despite uncertainties in the bond market, HDC successfully marketed $108,975,000 multi-family mortgage bonds in July of this year to aid New York City as the fiscal crisis continued.
successfully marketed
HDC’s 10-Year Anniversary
In its tenth year of operation, HDC issued no bonds due to historically high interest rates…a staggering 16.63%! This same year, start rates for the construction of new residential homes across the nation plunged to levels not seen since World War II.
HDC Issues Largest Insured Multi-
Family Housing Bond in History
Amidst record high interest rates and a deep recession, HDC prevailed with the most productive year of its decade-long history. In 1982, HDC issued over $240 million in bonds and notes to finance the construction and rehabilitation of more than 4,200 homes across 41 developments throughout the city. This included a $173 million tax-exempt bond issuance, the largest issuance for FHA-insured multifamily housing in US history at that time.
Congress Passes Tax Reform Act
The federal Tax Reform Act of 1986 significantly hindered multi-family residential development as New York City faced a growing housing crisis. At the same time, the Act created the low income housing tax credit (LIHTC), which would become a critical resource for the development of affordable housing across the nation.
HDC Closes First LIHTC Project
With financing gaps resulting from recent federal tax reform and escalating costs, construction on many multifamily residential projects like Northtown Phase II ground to a halt. HDC responded with its first federally taxable bond issuance and an allocation of low income housing tax credits to recover lost tax incentives in order to bring this 1,107-unit mixed-income development across the finish line.
Eric Enderlin talks about the birth of LIHTC and its ongoing impact
The 1990s
Period of Growth and Financial Innovation
HDC Recognized by Standard & Poor’s
HDC was recognized with “Top Tier” status by Standard & Poor’s Corporation, becoming the first local housing finance agency in the country to achieve an investment grade credit rating on its obligations (AA from Standard & Poors).
HDC Adopts Its Open Resolution
In 1993, HDC adopted its Multi-Family Housing Revenue Bond Resolution (Open Resolution), which today is HDC’s largest single asset. The Open Resolution is the Corporation’s primary finance program and permits the issuance of an unlimited amount of parity debt. The strength of the Open Resolution lies in its solid financial growth and over-collateralization to provide flexible and cost-effective low-cost capital that can be used to finance the development of affordable housing and efficiently respond to changing realities of the markets.
Open Resolution By the Numbers
or Preserved
NYC REMIC Completes First Full Year of Operations
This year marks the first full year of operations for the NYC REMIC after the NYS Legislature authorized the creation of the “New REMIC” to become incorporated as an HDC subsidiary – in that year REMIC committed to insure 18 mortgages comprising 518 homes.
Terry Gigliello talks about the role of REMIC
The 2000s
Demonstration of Leadership
HDC Launches Liberty Bond Program to Aid in the Recovery of Lower Manhattan
Following 9/11, the United States Congress provided New York City with authority of $800 million of tax-exempt Liberty Bonds to support the redevelopment and revitalization of Lower Manhattan - a neighborhood HDC’s headquarters have long called home. The following year, HDC launched its Liberty Bond program with the deployment of $245 million in bonds to finance the new construction and office conversions of two developments in lower Manhattan that would result in 1,048 units of multi-family housing. At the same time, HDC would generate origination funds through this program to be allocated to affordable housing developments across the city.
HDC Pioneers Use of Recycled Bond Cap at St. Ann’s Terrace
HDC was the first Housing Finance Agency in the nation to deploy recycled bonds with the 2009 financing of St. Ann’s Terrace in the Melrose neighborhood of The Bronx. This transformative mixed-use project includes 8 buildings spanning three acres and includes 640 affordable rental apartments, with 95 homes dedicated to formerly homeless households.
Ellen Duffy Discusses HDC’s Innovative Bond Recycling Initiative
The 2010s
Bold Strides to Create a More Affordable & Sustainable City
Green Building Criteria Advances
Even before the devastation of Superstorm Sandy emphasized the need for sustainable development, the City was prioritizing healthier, environmentally conscious design standards. Starting in 2011, all new construction and substantial rehab deals financed by HPD and HDC would be required to adhere for the first time to Enterprise Green Communities criteria and certification.
Superstorm Sandy Hits NYC
On October 29, 2012, Superstorm Sandy made landfall in New York City, resulting in unprecedented devastation that disproportionately impacted low-income communities. In response, HDC joined the Bloomberg Administration in prioritizing the redevelopment of housing and infrastructure of our coastal neighborhoods that were hardest hit, emphasizing climate-resiliency features that would ensure protections from future storms.
NYC Housing Connect is Launched Online!
NYC Housing Connect is launched, allowing the public to search for affordable housing opportunities and submit applications to new housing lotteries online for the first time. Later in 2020, Housing Connect was overhauled to streamline the application process, making the system quicker, easier to use, and more accessible to New Yorkers in need of housing.
The affordable housing lottery has come a long way thanks to the transformational launch of Housing Connect. Pictured here, is Governor Cuomo and Mayor Koch at the selection of housing lottery applicants in 1983.
Mayor de Blasio introduces Housing New York Plan
In May of 2014, the de Blasio Administration introduced the Housing New York plan, with an initial goal to produce 200,000 units of affordable housing over 8 years. Later in 2017, this goal was expanded to 300,000 homes by 2026 under Housing New York 2.0.
Ruth Moreira talks about creating a more affordable city through the Housing New York plan
HDC Introduces Sustainable Neighborhood Bonds
HDC introduces Sustainable Neighborhood Bonds, the first social investment bonds for the creation of affordable housing in the United States. Later, in 2019, this category would be transformed to Sustainable Development Bonds to align with the latest green and social bond market standards.
Early Sustainable Neighborhood Bond Developments
The 2020s
Rising to the Challenge and Expansion of HDC’s Mission
HDC Launches the Housing Impact Bond Resolution
HDC launched the Housing Impact Bond Resolution to support the expansion of its mission to finance the critical rehabilitation and preservation of our city’s public housing stock under NYCHA PACT (Permanent Affordability Commitment Together). HDC is partnering with NYCHA through PACT to ensure critical improvements and protections for our city’s public housing residents including:
Comprehensive Building Repairs & Apartment Renovations
Enhanced Property Management & Social Services
Guaranteed Tenant Protections
Permanent Affordability
Covid-19 Pandemic Underscores the Need for Safe and Affordable Housing
New Yorkers came together like never before to navigate the health and economic impacts resulting from the global COVID-19 pandemic. As the pandemic took its toll, our lowest income communities were among the hardest hit, underscoring the importance of safe and affordable housing. Despite many challenges of the moment, HDC joined our partners in pushing forward an ambitious affordable housing pipeline that would help provide housing stability at a time it was needed more than ever.
HDC Launches Multi-Family Mortgage Assistance & Forbearance Program
HDC launched the Multi-Family Mortgage Assistance & Forbearance Program in response to the economic impacts of the pandemic. Under this program, HDC works with our partners to provide tailored mortgage assistance and forbearance solutions to ensure a strong and stable portfolio.
2021 Annual Report
Our Progress
Susannah Lipsyte talks about the challenges and successes of the past year
Closings - Our Progress
Financed more than
affordable homes
Across
affordable housing
developments
Including
newly constructed homes
And
preserved homes
Closings - Featured Projects
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782 affordable co-operative homes preserved
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City-supervised Mitchell-Lama development
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HDC financing will support capital projects, improve energy efficiency and reduce long-term costs; including roof and building envelope repairs, lobby upgrades, plumbing repairs, cogeneration installation, and in-unit upgrades
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374 new affordable homes
•
100% permanently affordable
•
57 homes dedicated to formerly homeless households
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Developed as part of the larger Greenpoint Landing 10-year masterplan, which will create over 2,600 mixed-income affordable homes, public open space, a new public school, and local shops along the East River waterfront
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184 new affordable homes
•
28 homes designated to formerly homeless households
•
55 homes will remain permanently affordable
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The multi-phased Rockaway Village will include 1,700 units of affordable housing overall, alongside 12,000 square feet of commercial and community facility space
Ribbon Cuttings - Featured Projects
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The North & South Towers (Parcel C) comprise 1,194 new residential units
•
719 permanently affordable homes
•
100 homes for seniors
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Senior center operated by Selfhelp Community Services; community center operated by Sunnyside Community Services
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Phase 2 of master-planned, mixed-use, mixed-income community, including housing, a 572-seat K-8 school, playground, and 22,000 square foot park
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178-unit affordable development
•
50 homes for New Yorkers who have experienced chronic homelessness
•
78 permanently affordable homes
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Onsite supportive services and workforce development program operated by BronxWorks
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Developed on formerly City-owned land, Passive House Certified; ground floor grocery store offered through the FRESH (Food Retail Expansion to Support Health) Program
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180-unit, 100% permanently affordable development repurposing underutilized Van Dyke NYCHA campus land
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Serving extremely-low and low-income New Yorkers, including 31 homes set aside for NYCHA residents; 54 homes reserved for formerly homeless New Yorkers
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Onsite social services provided by CAMBA; daycare center operated by Friends of Crown Heights, community health clinic and wellness center operated by BMS Family Health & Wellness Center
PACT Progress
In 2021, HDC closed 3 new NYCHA PACT transactions benefiting 5,200 households across 6 NYCHA campuses in Brooklyn:
Baychester and Murphy Houses
Comprehensive renovations were completed this year on HDC’s first PACT transaction, benefiting more than 720 households in The Bronx. The residents of Baychester and Murphy Houses received extensive apartment renovations, critical infrastructure improvements, and an array of onsite social services provided by BronxWorks.
Baychester Murphy Exterior
Baychester Murphy Exterior (Before & After)
Baychester Murphy Kitchen (Before & After)
Baychester Murphy Bathroom (Before & After)
Baychester Murphy Hallway (Before & After)